Top 5 Cheap Companies To Buy For 2014

Value investing is one of the most intuitively appealing investment methods out there, and the reason is simple: Everyone loves a bargain. But just like smart shoppers ask tough questions about product quality before they jump on a sale-priced item, so too do value investors have to look closely at beaten-down stocks to decide whether they're truly good values or just cast-off clearance-rack companies with few future prospects.

The dangers of cheap stocks
If value investing were as simple as finding stocks trading at cheap prices, then it would be a trivial endeavor to make money. Even most beginning investors understand that low share prices by themselves mean nothing, as the total value of a company depends not only on the price per share of stock but also on the number of shares outstanding. A company with 1 million shares priced at $100 is worth the same as one with 100 million shares priced at $1, so gauging whether a stock is expensive or cheap based solely on share price doesn't give you enough information to draw valid conclusions.

Top 5 Cheap Companies To Buy For 2014: Bank of America Corporation(BAC)

Bank of America Corporation, a financial holding company, provides banking and nonbanking financial services and products to individuals, small- and middle-market businesses, large corporations, and governments in the United States and internationally. The company?s Deposits segment generates savings accounts, money market savings accounts, certificate of deposits, and checking accounts; and Global Card Services segment provides the U.S. consumer and business card, consumer lending, international card and debit card services. Its Home Loans & Insurance segment offers consumer real estate products and services, including mortgage loans, reverse mortgages, home equity lines of credit, and home equity loans. It also provides property, disability, and credit insurance. The company?s Global Commercial Banking segment offers lending products, including commercial loans and commitment facilities, real estate lending, leasing, trade finance, short-term credit, asset-based lending, and indirect consumer loans; and capital management and treasury solutions, such as treasury management, foreign exchange, and short-term investing options. Its Global Banking & Markets segment provides financial products, advisory services, settlement, and custody services; debt and equity underwriting and distribution, merger-related advisory services, and risk management products; and integrated working capital management and treasury solutions. The company?s Global Wealth & Investment Management segment offers investment and brokerage services, estate management, financial planning services, fiduciary management, credit and banking expertise, and asset management products. Bank of America Corporation serves customers through a network of approximately 5,900 banking centers and 18,000 automated teller machines. It was formerly known as NationsBank Corporation and changed its name on October 1, 1998. Bank of America Corporation was founded in 1874 and is based in Charlott e, North Carolina.

Advisors' Opinion:

• [By Dan Caplinger]

  It's important to understand that for the most part, the impact on banks from the bill would be minimal. Under the Federal Direct Loan Program, the Department of Education is the lender on Stafford loans extended through the program rather than a private lender. Admittedly, rising rates on Stafford loans might make private student loans from lenders Sallie Mae (NASDAQ: SLM  ) and Wells Fargo (NYSE: WFC  ) look somewhat less unattractive. But increased regulation led Bank of America (NYSE: BAC  ) , US Bancorp (NYSE: USB  ) , and several other institutions to reduce or eliminate their student lending programs, making it clear that student loans aren't enough of a money-making cash-cow to give banks an incentive to keep lending.

• [By Amanda Alix]

  Ambitious expansion plans
  Over time, M&T has grown steadily by its acquisitions. The bank has bought other institutions on an almost yearly basis since 2000, scooping up branches to extend its reach. In its constant search for growth, M&T has also been increasing its mortgage-servicing business, acquiring from Bank of America (NYSE: BAC  ) one of its loan servicing centers in New York state, assuming the lease on the building in addition to taking on the servicing of the loans formerly tended by B of A. The closing of the transaction with Hudson will add even more loans to its servicing base.

• [By Jessica Alling]

  Housing

  Pending home sales (Monday): Showing the number of homes currently in the sales process, this index can indicate how buyers are feeling about the market and the availability of credit. For bank investors, this report can also give a sense about the number of loans currently working their way through the closing process. Though Wells Fargo (NYSE: WFC  ) noted that its pipeline for new loans was smaller at the end of the second quarter compared with the prior one, new surges in buyer demand could be helping drive more business to the banks.
  Case-Shiller price index (Tuesday): As we've been seeing for some time, home prices are rising because of the unbalanced supply and demand for homes. Even though the interest-rate environment remains low, higher home prices could help the banks' revenue streams by allowing a greater amount of interest to be generated from new loans with higher principal balances. Though it may want volume to drive its growth in the mortgage market, Bank of America (NYSE: BAC  ) could very well gain ground by selling new mortgages to its wealthier clients -- allowing larger loans to advance its place in the origination hierarchy. MBA purchase applications (Wednesday): There has been a solid trend of declining activity in mortgage applications over the past few weeks, with last week's report showing another 2% drop. But with interest rates falling for the first time in more than two months, there may be new incentives for buyers to lock in the low rates now. Construction spending (Thursday): As we've seen from the past weeks' sales reports, home inventories are below the six-month range that economists view as a good balance between supply and demand. The construction spending report will give investors a glimpse of homebuilders' confidence in the housing market's continued advances, as well as their outlook on newly constructed home sales. This report also gives bank investors a sense of whether lendi

Top 5 Cheap Companies To Buy For 2014: Global Payments Inc.(GPN)

Global Payments Inc. provides electronic transaction processing services for merchants, independent sales organizations (ISO), financial institutions, government agencies, and multi-national corporations located in the United States, Canada, Europe, and the Asia-Pacific region. It offers a comprehensive line of processing solutions for credit and debit cards; business-to-business purchasing cards; gift cards; and electronic check conversion and check guarantee, verification, and recovery, including electronic check services, as well as terminal management. The company also offers proprietary software products to establish revolving check cashing limits for the casinos? customers in the gaming industry. In addition, it sells, installs, and services automated teller machine and point of sale terminals; and provides card issuing services, including card management and card personalization. The company markets its products directly, as well as through ISOs, retail outlets, tra de associations, alliance bank relationships, and financial institutions. Global Payments Inc. has a joint venture with La Caixa Group to provide merchant acquiring services to merchants in Spain. Global Payments Inc. was founded in 2001 and is headquartered in Atlanta, Georgia.

Advisors' Opinion:

• [By Ben Levisohn]

  Global Payments�(GPN) has gained 6.8% to $54.12 in pre-open trading after the payment processing company reported a profit of $1 a share, beating analyst forecasts of 95 cents. It also said it would buy back stock.

• [By Monica Gerson]

  Global Payments (NYSE: GPN) is expected to post its Q1 earnings at $0.95 per share on revenue of $623.79 million.

  Synergetics USA (NASDAQ: SURG) is projected to post its Q4 earnings at $0.06 per share on revenue of $17.01 million.

• [By Monica Gerson]

  Global Payments (NYSE: GPN) reported upbeat fiscal first-quarter results and raised its annual forecast. Global Payments named Jeffrey S. Sloan as its new chief executive and announced its plans to buy back up to $100 million of its common stock. Global Payments shares surged 6.80% to $54.15 in the after-hours trading session.

Hot Energy Stocks To Buy For 2014: Freeport-McMoran Copper & Gold Inc.(FCX)

Freeport-McMoRan Copper & Gold Inc. engages in the exploration, mining, and production of mineral resources. The company primarily explores for copper, gold, molybdenum, silver, and cobalt. It holds interests in various properties, located in North and South America; the Grasberg minerals district in Indonesia; and the Tenke Fungurume minerals district in the Democratic Republic of Congo. As of December 31, 2010, the company?s consolidated recoverable proven and probable reserves totaled 120.5 billion pounds of copper, 35.5 million ounces of gold, 3.39 billion pounds of molybdenum, 325.0 million ounces of silver, and 0.75 billion pounds of cobalt. The company was founded in 1987 and is headquartered in Phoenix, Arizona.

Advisors' Opinion:

• [By Brian Pacampara]

  Based on the aggregated intelligence of 180,000-plus investors participating in Motley Fool CAPS, the Fool's free investing community, global mining giant Freeport-McMoRan Copper & Gold (NYSE: FCX  ) has earned a respected four-star ranking.

Top 5 Cheap Companies To Buy For 2014: Sprott Resource Lending Corp.(SILU)

Sprott Resource Lending Corp., a natural resource lender, provides bridge and mezzanine financing to precious and base metal mining, exploration, and development companies, as well as energy companies worldwide. The company was formerly known as Quest Capital Corp. and changed its name to Sprott Resource Lending Corp. in September 2010. Sprott Resource Lending Corp. was incorporated in 1980 and is based in Toronto, Canada.

Top 5 Cheap Companies To Buy For 2014: DRDGOLD Limited(DROOY)

DRDGOLD Limited engages in the exploration, extraction, processing, and smelting of gold in South Africa. It holds interests in the Blyvoor mine; and the Crown gold surface tailings retreatment facility that reprocesses sand and slimes dumps, as well as involves in the surface retreatment operations. The company was incorporated in 1895 and is based in Roodepoort, South Africa.